See exactly what you earn on each sale. Enter your price and your true cost to get profit, margin, and markup at a glance — then use a target margin to find the price you should be charging.
Your numbers
At $40.00 with $25.00 of cost you make $15.00 — a 37.5% margin (60% markup). To hit a 50% margin you would price at $50.00.
Margin vs markup
| Profit margin | Equivalent markup |
|---|---|
| 20% | 25% |
| 33% | 50% |
| 40% | 67% |
| 50% | 100% |
| 60% | 150% |
Margin is profit as a share of the price; markup is profit as a share of the cost. They are easy to confuse and the gap grows fast.
Make the margin work
- Use your full cost — materials, labor, and overhead — not just supplies.
- Thin margins leave nothing for a sale, a refund, or a bad month.
- Wholesale usually needs roughly a 50% margin so retail still works.
- Raise prices in small steps rather than waiting for one painful jump.
Frequently asked questions
What is the difference between margin and markup?
Margin is profit as a percentage of the selling price; markup is profit as a percentage of the cost. A 50% margin is the same as a 100% markup.
How do I calculate profit margin?
Subtract cost from price to get profit, then divide profit by the price and multiply by 100. For example, $15 profit on a $40 price is a 37.5% margin.
What is a good profit margin for handmade goods?
Many makers target 25 to 50% after counting materials, labor, and overhead. Lower margins leave no cushion for discounts, returns, or wholesale.
How do I find the price for a target margin?
Divide your cost by one minus the target margin. For a 50% margin on $25 of cost: 25 divided by 0.5 equals a $50 price.